Ellen Cibula
Written by Ellen Cibula Payments, Finance, and AI Expert: Learn More

Wondering how to increase revenue for your business?

Leverage the power of an independent sales organization (ISO). ISOs help you expand by providing access to more payment processing options so you can reach more customers. With the best ISO, you can provide a better customer experience while enjoying lower transaction fees and increasing profits.

Your business will be able to quickly scale up with an ISO partner who understands your needs and provides superior support every step of the way. You’ll have fewer headaches when it comes to meeting customer demands as well as expanding into new markets or launching new products that require different payment methods.

In the world of merchant services, partnering with an independent sales organization (ISO) can provide significant advantages to businesses seeking reliable and cost-effective payment processing solutions. ISOs are brokers between companies and financial institutions, providing many services to make transactions more efficient while guaranteeing safety and adherence.


An ISO specializes in providing payment processing services to companies by serving as intermediaries between merchant service providers and businesses.

As someone with several years of experience in fintech and having worked for a large payment processor, I am qualified to discuss the advantages of using an independent sales organization (ISO) for payment processing to boost a business’s revenue. With my background in payment processing, I understand the industry and have witnessed how ISOs can help companies to streamline their payment processing while reducing costs. My insights will no doubt be valuable to anyone looking to optimize their payment processing and enhance the growth of their business.

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What is an Independent Sales Organization (ISO)?

An Independent Sales Organization (ISO) is a third-party organization that specializes in providing payment processing services to companies of various sizes and industries. ISOs work as intermediaries between merchant account providers, such as banks or financial institutions, and the businesses that require these services.

Typically, ISOs partner with credit card associations like Visa and Mastercard and member banks or other financial firms to offer merchant accounts to their clients. These partnerships enable them to manage merchant accounts on behalf of their clients while providing customer service and support for all aspects of payment processing.

The Role of ISOs in Payment Processing

  • Sales agents: Independent sales organizations make money through commissions from selling payment processing solutions, so they often employ a team of sales agents responsible for acquiring new clients.
  • Credit card associations: To provide merchants access to popular credit cards like Visa or Mastercard, ISOs must establish relationships with association member banks that issue these cards.
  • Merchant account management: Once an acquiring bank approves a business for a merchant account, the ISO will help manage the account by handling tasks such as transaction monitoring and reporting.
  • Promoting innovation: Many ISOs invest in cutting-edge payment technology solutions like mobile payments or contactless transactions, which can benefit small and large businesses.

Difference Between Merchant Service Providers & Independent Sales Organizations

In some cases, the terms merchant service providers and independent sales organizations are used interchangeably. However, there is a distinction between the two. At the same time, MSPs provide payment processing solutions directly to businesses, and ISOs serve as intermediaries connecting clients with either MSPs or financial institutions. ISOs link MSPs or processing banks and their customers, facilitating payment processing solutions to businesses and customer service, account management, and access to cutting-edge payment technologies.

key takeaway

An independent sales organization acts as a bridge connecting businesses with the necessary resources for accepting payments from customers while providing support in areas such as customer service, account management, and access to innovative payment technologies.

Benefits of Working with an ISO

Partnering with an ISO can provide numerous advantages for businesses looking to enhance their processing capabilities.

A Wide Range of Payment Processing Solutions

An ISO offers businesses access to various processing solutions tailored to their needs. These include:

  • Credit and debit card payments
  • E-commerce solutions for online transactions
  • Contactless payments through mobile wallets or smart devices
  • Invoicing systems for billing customers directly
  • Point-of-sale (POS) terminals designed for brick-and-mortar stores or events.

Latest Security Technologies & Fraud Prevention Tools

In this digital age, the protection of confidential financial data is essential. ISOs work closely with credit card institutions like Visa and Mastercard as well as acquiring banks such as Wells Fargo to stay up-to-date on the latest security protocols in the industry. This partnership allows them to offer advanced fraud prevention tools like end-to-end encryption, tokenization technology, secure socket layer (SSL) certificates, address verification service (AVS), and more.

Dedicated Customer Support & Service Management

A significant advantage of working with an independent sales organization is having access to dedicated customer support teams that specialize in handling merchant account issues promptly and efficiently. From setting up new accounts to troubleshooting technical problems, ISOs provide a level of personalized service often lacking when dealing directly with large processing banks. Additionally, many ISOs offer account management services to help businesses optimize their payment systems and minimize costs.

Access to High-Risk Merchant Accounts

Due to the type of their goods or services, specific sectors can be considered high-risk. They may have difficulty getting merchant accounts from conventional banks. Examples include online gambling sites, credit repair companies, and CBD vendors. By partnering with an ISO, these high-risk merchants can gain access to specialized merchant account providers who understand the unique challenges they face and offer tailored solutions accordingly.

Innovative Payment Technology & Industry Expertise

An independent sales organization stays ahead in the ever-evolving world of payment technology by constantly researching new trends and innovations within the industry. This allows them to offer cutting-edge solutions. They also share valuable insights on best practices for businesses looking to enhance their overall customer experience while accepting online and offline payments, such as credit card payments.

key takeaway

Partnering with an ISO can provide businesses access to the following:

  • Wide range of payment processing solutions
  • Advanced fraud prevention tools
  • Dedicated customer support teams
  • Specialized merchant account providers for high-risk industries and innovative payment technology.

Understanding Payment Processing Fees

When working with an ISO, businesses should understand the fees associated with payment processing services. Fees associated with credit card processing services can range from transaction fees to monthly service charges and other costs. By clearly understanding these charges, business owners can make informed decisions when selecting an ISO and ensure they are getting the best value for their investment.

Transaction Fees

Transaction fees, which are calculated as a percentage of the sale amount plus an additional fixed cost per transaction, are imposed by financial institutions or merchant account providers for each customer purchase made with a credit or debit card. The fee is typically calculated as a percentage of the total sale amount plus a fixed per-transaction cost. For example, if your ISO charges 2% + $0.10 per transaction and you process a $100 sale, you would pay $2 in percentage-based fees plus $0.10 for the transaction itself.

Monthly Service Fees

  • Statement Fee: This is charged by some ISOs to cover the cost of providing monthly statements detailing your transactions and any applicable fees.
  • Gateway Fee: If your business accepts online payments through an e-commerce platform or website, you may be required to pay a gateway access fee for secure payment data transmission between your site and the acquiring bank.
  • BATCH Fee: A BATCH fee might be applied every time you settle/close out transactions on POS terminal at the end of the day.

Other Costs Associated With Accepting Payments

In addition to the standard transaction and monthly service fees, businesses may encounter other costs when working with an ISO. These can include:

  • Setup Fees: Some ISOs charge a one-time fee to set up your merchant account and payment processing services.
  • Equipment Costs: Purchasing or leasing point-of-sale (POS) equipment such as card readers or terminals will add to your overall expenses.
  • Chargeback Fees: In the event of a disputed transaction resulting in a chargeback, most financial firms and payment processors will impose a fee on the merchant for handling the dispute process.

To ensure that you are getting the best value from your chosen independent sales organization, it’s essential to carefully review their pricing structure and compare it against other options available in the market. Additionally, don’t hesitate to negotiate with potential providers – many ISOs are willing to offer competitive rates or waive some fees to secure new clients. Finally, always prioritize quality customer support over cost savings; after all, reliable assistance during technical difficulties is invaluable for maintaining smooth business operations.

key takeaway

Businesses working with an independent sales organization (ISO) should understand payment processing fees, including transaction and monthly service fees. Other costs that could be incurred concerning taking payments may include setup expenses, hardware expenditures, and chargeback charges. You need to review pricing structures carefully, negotiate with potential providers for competitive rates or waived fees, and prioritize quality customer support over cost savings.

How to Choose an ISO

When selecting an ISO for your business, it’s crucial to consider factors such as customer service, pricing structure, and the types of payment processing solutions the company offers.

Evaluate Customer Service Quality

The level of customer service an ISO provides is critical in ensuring smooth payment processing operations for your business. Look for companies with a reputation for providing excellent support through various phone, email, or live chat channels. You can also check online reviews from other businesses that have worked with the ISO to gauge their satisfaction levels regarding customer support.

Analyze Pricing Structure

When choosing an ISO partner, you need to understand the fees associated with transaction processing services, including transaction and monthly service charges. Compare different providers’ pricing structures to find one that aligns well with your budget while still offering competitive rates on transactions.

Assess Processing Solutions Offered

Different ISOs offer various transaction processing solutions, such as credit card acceptance, e-commerce platforms, and mobile payment options. Consider your business’s specific needs when evaluating an ISO’s services.

  • Credit Card Association: Ensure that the ISO is partnered with major credit card associations like Visa, Mastercard, American Express, and Discover to provide seamless transactions for your customers.
  • E-commerce Solutions: If you operate an online store or plan to expand into e-commerce in the future, look for providers offering secure and user-friendly e-commerce platforms compatible with popular shopping carts.
  • Mobile Payment Options: Select an ISO that supports mobile payments through popular apps like Apple Pay or Google Wallet if you want to cater to customers who prefer this mode of payment.

Check Security Measures & Fraud Prevention Tools

In today’s digital world, where data breaches are common, security technologies and fraud prevention tools should be a top priority when choosing an independent sales organization. Look for companies that use advanced encryption methods during transactions while also providing real-time monitoring systems designed to detect fraudulent activities before negatively impacting your business.

key takeaway

When choosing an independent sales organization (ISO), it’s crucial to consider customer service quality, pricing structure, processing solutions offered, and security measures. Look for companies with excellent support through various channels and competitive transaction rates. Ensure the ISO offers secure transaction processing solutions compatible with your business needs while providing advanced fraud prevention tools to protect against data breaches.


ISOs act as intermediaries between merchants and the financial institutions involved in transaction processing.

ISOs primarily earn money through fees charged to merchants for their services. These fees may include transaction fees, monthly service charges, equipment rental or purchase costs, and setup fees. Additionally, some ISOs receive revenue sharing from the partnering banks or payment processors based on generated transaction volume.

Independent Sales Organizations make money by providing various merchant services to businesses at competitive rates while maintaining relationships with multiple banks and payment processors. They profit from the difference between wholesale pricing obtained from these partnerships and retail pricing offered to merchants.

No, PayPal is not an Independent Sales Organization (ISO). Instead, it operates as a Payment Service Provider (PSP), offering online payment solutions directly to consumers and businesses without acting as an intermediary between traditional banking institutions, as most ISOs do.


ISOs help simplify transaction processing and offer competitive rates. Although they may be called merchant service providers, they are slightly different because they work as intermediaries between the business owner and the acquiring member banks.

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